Best Mushroom Stocks: Top Picks, Pros and Cons

Mushroom stocks are an emerging sector in the stock market, attracting speculative attention for their potential role in mental health treatments. These companies focus on the development of psychedelic compounds such as psilocybin, MDMA, LSD, and ketamine, all of which are being researched as possible therapies for depression, anxiety, PTSD, and schizophrenia. With increasing interest in alternative mental health treatments, the industry is seeing rapid growth and investment.

Traders should understand that investing in this sector comes with both opportunities and risks. Many companies are in the clinical trial phase, meaning their stock prices are highly speculative. The potential for FDA approval could send shares soaring, but setbacks in research or regulation could also cause sharp declines. If you’ve followed my trading lessons, you know that hype can drive massive short-term gains, but traders must be disciplined and avoid chasing stocks blindly.

I’ll break down the most promising mushroom stocks and explain the factors you need to consider before trading them. These picks aren’t long-term investments—they’re volatile plays that require a solid strategy. Let’s get into it.

What Are Mushroom Stocks?

Mushroom stocks refer to companies that develop psychedelic-based therapies for mental health disorders. These companies work on clinical trials, research, and the potential commercialization of psychedelic treatments. Unlike traditional pharmaceutical companies, many of these businesses focus exclusively on psychedelic compounds such as psilocybin, MDMA, and LSD.

The sector is still in its early stages, meaning stock performance is tied to clinical trial results, regulatory approvals, and industry sentiment. Investors need to watch key developments like FDA approvals, funding rounds, and partnerships with major pharmaceutical companies. I’ve seen countless traders jump into hype-driven sectors without understanding the fundamentals—don’t make that mistake. Know what you’re trading and why.

Because these stocks are speculative, they behave more like penny stocks. That means volatility, large swings in price, and the potential for massive gains or steep losses. If you’re trading them, be prepared to cut losses quickly and lock in profits when they’re available.

Top Psychedelic Stocks for 2025

If you’re looking to trade mushroom stocks, these are some of the top companies making moves in the sector. Keep in mind, these aren’t traditional investments—they’re high-risk trades that require proper risk management.

Before you send in your orders, take note: I have NO plans to trade these stocks unless they fit my preferred setups. This is only a watchlist.

The best traders watch more than they trade. That’s what I’m trying to model here. Pay attention to the work that goes in, not the picks that come out.

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Atai Life Sciences N.V. (NASDAQ: ATAI) – The Big Pharma Contender

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This is one of the most well-funded psychedelic stocks out there. Atai has a ton of cash and is throwing money at multiple projects, hoping one will hit big. That’s great for traders—more news, more catalysts, more volatility.

Why traders should watch:

• Heavy cash reserves: $101 million in cash means they can keep running trials for years without worrying about funding.
• Multiple shots on goal: They’re working on psilocybin, MDMA, and DMT treatments, so they have a diversified approach.
• Big Pharma approach: They acquire smaller companies instead of developing everything in-house, which spreads out risk.

Trading angle: Watch for trial results. The second the company announces positive clinical data, this stock could spike. If there’s a delay or bad news, it’ll tank.

Mind Medicine (MindMed) Inc. (NASDAQ: MNMD) – The LSD Play

MindMed is all about LSD-based treatments. This company was an early hype stock in the psychedelic sector, and it still has a strong following. But it’s volatile—big spikes, big crashes.

Why traders should watch:

• Late-stage trials: MM-120 (their LSD-based anxiety treatment) is heading into Phase 3, which is a huge deal.
• Strong financial backing: Just raised $250 million—enough to keep running trials and keep traders interested.
• FDA fast track: Their therapies have Breakthrough Therapy Designation, which means the FDA is paying attention.

Trading angle: News drives this stock. FDA approvals, partnerships, or trial updates could send it flying. But if the stock spikes too fast on hype, expect a pullback—perfect for dip-buying opportunities.

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GH Research PLC (NASDAQ: GHRS) – The Fast-Acting DMT Play

This company is working on mebufotenin (5-MeO-DMT), a psychedelic that could be used for treatment-resistant depression. Their trial results have been impressive, and traders are taking notice.

Check out the newest GHRS news here!

Why traders should watch:

• Massive trial success: In Phase 2, 57.5% of patients went into remission—huge results compared to existing depression treatments.
• Upcoming Phase 3 trials: The company is gearing up for the final testing phase, which means big news catalysts are coming.
• Under-the-radar play: It’s not as hyped as some others, meaning there’s still room for upside if more traders catch on.

Trading angle: This stock moves on trial results. If Phase 3 looks strong, it could run. But if the results aren’t as good as expected, expect a dump.

Cybin Inc. (NASDAQ: CYBN) – The Psychedelic Stock That Stevie Cohen Owns Shares In

Cybin is developing both psilocybin and DMT treatments, with a focus on making them work faster and more efficiently. It’s spiked in the past.

Why traders should watch:

• The Stevie Cohen seal of approval: Billionaire hedge fund owner Steve Cohen owns a big stake in CYBN.
• Strong trial pipeline: CYB003 (psilocybin for depression) and CYB004 (DMT for anxiety) are both in mid-stage trials.
• Former runner: Former runners can run again — and this stock has seen some big runs over the years.

Trading angle: Look for news, and then trade safe, following my 7-step pennystocking framework.

Incannex Healthcare Inc. (NASDAQ: IXHL) – The Psychedelic and Cannabinoid Stock

Incannex is developing psychedelic and cannabinoid-based treatments, but the company is facing some financial struggles. That makes it extra volatile.

Why traders should watch:

• Recently raised $12.5M through a new stock offering: This keeps them in the game, at their shareholders’ expense. It’s not the first time they’ve diluted their stock.
• Clinical trials ongoing: They’re still pushing forward with research, meaning there are potential catalysts ahead.
• NASDAQ delisting risk: If they don’t boost their market cap, they could get kicked off the exchange. This kind of uncertainty creates wild volatility.

Trading angle: High risk, but high potential for big spikes on positive news. If they announce a major partnership or strong trial data, this could rip. But if they run out of funding, it could crash.

The Rise of Psychedelic Stocks

Over the last few years, the psychedelics industry has seen a surge in interest from investors, researchers, and biotech companies. Clinical trials have shown promising results, especially in treating depression, PTSD, and addiction. Companies are racing to bring these treatments to market, and traders are paying close attention to the stocks moving with the news.

Much like how cannabis stocks exploded in popularity before the industry matured, psychedelic stocks are experiencing a similar speculative phase. The market remains unproven, and regulatory challenges are still a major hurdle. However, the potential upside is significant, and early traders who time their moves correctly could see substantial gains.

Governments around the world are reconsidering the legal status of psychedelics. In the U.S., the FDA has granted “Breakthrough Therapy” designation to some psilocybin and MDMA treatments, speeding up the approval process. Meanwhile, countries like Australia have already approved certain psychedelic treatments for medical use. As regulations evolve, the industry could see rapid growth.

Mushroom stocks cover companies working with both medicinal and psychedelic mushrooms. But they aren’t the only option in the space. Psychedelic-focused stocks include companies researching treatments for mental health conditions, often overlapping with biotech. If you’re tracking this sector, it makes sense to look at other psychedelic stocks beyond mushrooms. Here’s a list of top psychedelic stocks to watch.

Why Invest in Psychedelic Stocks?

The potential for psychedelic stocks lies in their ability to transform mental health treatments. Traditional antidepressants and anxiety medications don’t work for everyone, and psychedelics offer a new approach. Companies in this sector are researching how these substances can be used in clinical settings to treat conditions that have few effective solutions.

At the same time, investors see the long-term opportunity in a brand-new market. If these treatments gain full FDA approval, the companies behind them could see their stock prices skyrocket. But remember—this is a highly speculative sector. Just like with cannabis stocks, hype can drive short-term gains, but long-term success depends on scientific results and regulatory decisions.

For traders, the volatility in this sector makes it ideal for short-term plays. News catalysts, clinical trial results, and regulatory updates can create rapid price movements, offering opportunities for well-prepared traders to capitalize on momentum.

Are Psychedelic Stocks Legal?

Yes, but with conditions. While it’s legal to trade stocks in psychedelic companies, the substances themselves are still under strict regulation in most countries. The FDA and other regulatory agencies are closely monitoring clinical trials to determine whether these treatments will be approved for medical use.

Psilocybin and MDMA have already received “Breakthrough Therapy” designation from the FDA, which means they’re being fast-tracked for potential approval. However, full commercialization is still years away. Traders should keep an eye on regulatory news because any delays or approvals could have major impacts on stock prices.

Psychedelic stocks operate in a legal gray area. Some companies focus on FDA-approved research, while others push for legalization. This is similar to how marijuana stocks developed before widespread legalization. If you’re interested in high-risk, high-reward sectors, you should also watch cannabis stocks. See the top marijuana stocks here.

Investing in Psychedelic Stocks: Pros and Cons

I’m not an investor — especially not in volatile stocks like those in the psychedelic sector.

If you are committed to putting some of these stocks in your portfolio — or maybe investing in ETFs like AdvisorShares Psychedelics ETF (NYSEARCA: PSIL) — here are the pros and cons:

Pros:

• High Growth Potential: If psychedelic therapies gain FDA approval, early investors could see massive returns.
• Increasing Public and Scientific Support: More studies are showing positive results, which is helping shift public perception.
• Market Disruption: These treatments could replace traditional antidepressants and anxiety medications, creating new investment opportunities.

Cons:

• Regulatory Uncertainty: Governments could delay or block approvals, causing stock prices to crash.
• High Volatility: These stocks move fast, making them risky for inexperienced traders.
• Limited Revenue: Many companies are still in clinical trials and aren’t generating profits yet.

Are Psychedelic Mushroom Stocks Right for You?

Psychedelic mushroom stocks are part of a speculative biotech sector, and that means high volatility. These companies are still navigating clinical trials, regulatory hurdles, and market acceptance. Just because there’s hype around psilocybin, MDMA, and ketamine treatments doesn’t mean these stocks fit your financial strategy. Traders must evaluate risk tolerance before jumping in—these aren’t stable, revenue-generating companies yet.

If you’re someone looking for steady dividend-paying stocks, this sector isn’t for you. But if you’re a trader who thrives on volatility and understands how to capitalize on momentum-driven plays, psychedelic stocks could offer short-term trading opportunities. Remember, biotech stocks can spike on positive FDA trial results or crash on setbacks. The key is to trade them, not invest in them blindly.

Psychedelic stocks can be volatile, with regulatory hurdles and clinical trial risks. Many trade as penny stocks, making them speculative plays. If you’re looking at psychedelic stocks, biotech penny stocks could also be worth considering. They face similar risks and can also move big on news. Here’s a list of biotech penny stocks worth tracking.

How to Buy Psychedelic Mushroom Stocks

If you’re looking to trade psychedelic mushroom stocks, the first step is to choose a brokerage that offers access to exchanges where these companies are listed. Many of the top players in this sector, like MindMed (NASDAQ: MNMD) and Cybin (NYSE: CYBN), trade on major exchanges like NASDAQ and NYSE. Others are listed on smaller exchanges, where liquidity can be lower.

Make sure the platform you choose provides real-time market data, fast execution, and access to research tools. Because these stocks move fast on news, you need a broker that allows quick entry and exit. Some ETFs also offer exposure to the psychedelic sector, which can help diversify risk if you don’t want to trade individual stocks.

Platform to Use for Mushroom Stock Trading

When it comes to trading platforms, StocksToTrade is first on my list. It’s a powerful day and swing trading platform with real-time data, dynamic charting, and a top-tier news scanner. I helped to design it, which means it has all the trading indicators, news sources, and stock screening capabilities that traders like me look for in a platform.

I use StocksToTrade to scan for news, tweets, earning reports, and more — all covered in its powerful news scanner. It also has a selection of add-on alerts services, so you can stay ahead of the curve.

Grab your 14-day StocksToTrade trial today — it’s only $7!

Key Takeaways

• Psychedelic stocks offer high-risk, high-reward trading opportunities.
• Clinical trial progress and FDA approvals will dictate price movements.
• These aren’t long-term investments—trade them with a strategy and take profits when available.

Trading these stocks requires discipline. The sector is full of hype, and while some companies will succeed, many will fail. Stick to trading patterns that are in your wheelhouse, manage your risk, and always have an exit plan.

This is a market tailor-made for traders who are prepared. Psychedelic stocks thrive on volatility, but it’s up to you to capitalize on it. Stick to your plan, manage your risk, and don’t let FOMO drive your decisions.

These opportunities are fast and unpredictable, but with the right strategy and plenty of study time you can make them work for you.

If you want to know what I’m looking for—check out my free webinar here!